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This is to certify that the project entitled submitted By RASIKA ARUN
SHELARRoll no. 3018 student of M.Com PartII Advanced Accountancy (University
of Mumbai) Semester IV examination has not submitted by any other examination
& does not form a part of any other course undergone by the candidate as a result of
genuine & Bonafide effort. It is further certified that she has completed the required
phases of the project. This project is original to the best of our knowledge & has been
accepted for Internal Assignment.
Internal Examiner



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I RASIKA ARUN SHELAR Student of M.Com Part- II (Advanced Accountancy)

Roll no.3018, hereby wish to state that the work embodied in the project entitled
RESEAECH METHODOLOGY by me to the University of Mumbai for semester

III examination during the Academic year 2015-16.The said report are forms of my

own contribution based on actual work carried by me under the guidance &
supervision of Mrs.suchitra poojary
I further wish to state that this work is original & has not submitted for any other
degree of this or any other examination. Whenever the references have been made to
the previous work of others, it has been clearly indicated as such & included in the
Bibliography or list of preferences.

Name of the student: RASIKA ARUN SHELAR



Roll no.:3018
Place: Thakurli

I have received valuable support from the various individuals & institutions. It will be
difficult to name all of them here. However, I would like to specifically record my
sense of gratitude & indebtedness to some of them.
I am indeed grateful & wish to acknowledge my deep sense of gratitude to Mrs.
VRUNDA YADWAD whose erudite & profound scholarship inspired me to undertake
project assignment & complete said project under his guidance, support & sparing his
valuable time in his busy schedule without which this report would not have been

I am grateful to Principle Dr.V.S.Adigal & Co-ordinator of PG Centre at Manjunatha

College of Commerce for the support & encouragement & also expressed my
gratitude to his supportive staff for helping me in my submission of this assignment.
I also owe my indebtedness & record my feelings with love & affection here to my
parents who are the pillars in my life. My sincere thanks are also due to my friends,
relatives & other well-wishers for their constant help in the pursuit of the completion
of this report.
Finally last but not least I would like to express my gratitude to all those who are
directly or indirectly help me in this project.
Place: Thakurli

Signature of the student


Title of study - The title of project is COMPETITIVE FINANCIAL STATEMENTS OF

Objectives of the study: To study the financial statements.

To study the overall market situation of automobile industry.
To find out the Comparative difference of financial statements of Bajaj Auto
Ltd and Hero Moto Corp.
To know the influences of financial statements in todays competitive world.
Methodology of study:For the purpose of the present study, only secondary data were used.
Primary Data - The main sources of primary data was annual report of
Secondary Data - The main sources of secondary data were combination of

information from the internet and books of the related topic.

Limitation of the study: The study is made up to the information available apart from which there were
some informations which was hidden and not clearly given.

Chapter Layout:Chapter 1: Introduction & Theoretical view

Chapter 2: Profile of Company
Chapter 3: Financial Analysis of Bajaj Auto Ltd
Chapter 4: Financial Analysis of Hero Motocorp Ltd
Chapter 5: Comparison of Financial Statements
Chapter 6: Conclusion


Financial Statements
Definition: Financial statements are a collection of reports about an organization's
financial results, financial condition, and cash flows. They are useful for the following

To determine the ability of a business to generate cash, and the sources and
uses of that cash.

To determine whether a business has the capability to pay back its debts.

To track financial results on a trend line to spot any looming profitability


To derive financial ratios from the statements that can indicate the condition of
the business.

To investigate the details of certain business transactions, as outlined in the

disclosures that accompany the statements.
The standard contents of a set of financial statements are:

Balance sheet. Shows the entity's assets, liabilities, and stockholders' equity as
of the report date. It does not show information that covers a span of time.

Income statement. Shows the results of the entity's operations and financial
activities for the reporting period. It includes revenues, expenses, gains, and losses.

Statement of cash flows. Shows changes in the entity's cash flows during the
reporting period.

Supplementary notes. Includes explanations of various activities, additional

detail on some accounts, and other items as mandated by the applicable accounting
framework, such as GAAP or IFRS.
If a business plans to issue financial statements to outside users (such as investors or
lenders), the financial statements should be formatted in accordance with one of the
major accounting frameworks. These frameworks allow for some leeway in how
financial statements can be structured, so statements issued by different firms even in
the same industry are likely to have somewhat different appearances.

If financial statements are issued strictly for internal use, there are no guidelines, other
than common usage, for how the statements are to be presented.
At the most minimal level, a business is expected to issue an income statement and
balance sheet to document its monthly results and ending financial condition. The full
set of financial statements is expected when a business is reporting the results for a
full fiscal year, or when a publicly-held business is reporting the results of its fiscal

Importance of a Company's Financial Statements

A companys financial statements provide various financial information that investors
and creditors use to evaluate a companys financial performance. Financial statements
are also important to a companys managers because by publishing financial
statements, management can communicate with interested outside parties about its
accomplishment running the company. Different financial statements focus on
different areas of financial performances.
Financial Conditions
A companys financial conditions are of a major concern to investors and creditors. As
capital providers, investors and creditors rely on a companys financial conditions for
both the safety and profitability of their investments. More specifically, investors and
creditors need to know where their money went and where it is now. The financial
statement of balance sheet addresses such issues by providing detailed information
about a companys asset investments. The balance sheet also lists a companys
outstanding debt and equity components, and so debt and equity investors can better
understand their relative positions in a companys capital mix.
Operating Results
Financial conditions shown in the balance sheet are snapshots of a companys assets,
liabilities and equity at the end of a financial reporting period; they dont reveal what
happened during the period from operations that may have caused changes to financial
conditions. Therefore, operating results during the period also concerns investors. The
financial statement of income statement reports operating results such as sales,
expenses and profits or losses. Using the income statement, investors can both
evaluate a companys past income performance and assess the uncertainty of future
cash flows.
Cash Flows
A companys profits reported in the income statement are accounting income and most
likely contain certain non-cash elements, providing no direct information on a
companys cash exchange during the period. Moreover, a company also incurs cash

inflows and outflows during a period from other non-operating activities, namely
investing and financing. To investors, cash from all sources, not just accounting
income from operations, is what pays back their investments. The importance of the
cash flow statement is that it shows the exchange of cash between a company and the
outside world during a period, and so investors can know if the company has enough
cash to pay for expenses and asset purchases.
Shareholders Equity
The statement of shareholders equity is especially important to equity investors
because it shows the changes in various equity components, including retained
earnings, during a period. The amount of shareholders equity is a companys total
assets minus its total liabilities, representing the companys net worth.

Chapter 2
Profile of Company


Bajaj Auto Limited is an Indian two-wheeler and three-wheeler manufacturing

company. Bajaj Auto manufactures and sells motorcycles, scooters and auto
rickshaws. Bajaj Auto is a part of the Bajaj Group. It was founded by Jamnalal
Bajaj in Rajasthan in the 1930s. It is based in Pune, Mumbai, with plants
in Chakan (Pune), Waluj (near Aurangabad) and Pantnagar in Uttarakhand. The oldest
plant at Akurdi (Pune) now houses the R&D centre 'Ahead'.
Bajaj Auto is the world's sixth-largest manufacturer of motorcycles and the fourthlargest in India.[5] It is the worlds largest three-wheeler manufacturer.
On 31 March 2013, its market capitalisation was INR 520 billion (US$9.57 billion),
making it India's 23rd largest publicly traded company by market value. The Forbes
Global 2000 list for the year 2012 ranked Bajaj Auto at 1,416.

Bajaj manufactures and sells motorcycles, scooters, auto-rickshaws and most recently,
cars. Bajaj Auto is Indias largest exporter of motorcycles and three-wheelers. [1] Bajaj
Autos exports accounted for approx. 35% of its total sales. 47% of its exports are
made to Africa.[1] Boxer motorcycle is the largest selling single brand in Africa.
Motorcycles in production are the Platina, Discover, Pulsar and Avenger. Bajaj also
distributes motorcycles in India for other manufacturers, such as the Kawasaki Ninja
250R, the Ninja 650R and new for 2012, the KTM Duke 200.
In FY 2012-13, it sold approx. 3.76 million motorcycles which accounted for 31% of
the market share in India. Of these, approx. 2.46 million motorcycles (66%) were sold
in India and remaining 34% were exported.
Three wheelers
It is the world's largest manufacturer of 3-wheelers and accounts for almost 84% of
Indias three-wheeler exports. During the FY 2012-13, it sold approx. 480,000 threewheelers which was 57% of the total market share in India. Out of these 480,000
three-wheelers, 53% were exported and remaining 47% were sold in India.

Low cost cars
In 2010, Bajaj Auto announced cooperation with Renault and Nissan Motor to develop
a US$2,500 car, aiming at a fuel efficiency of 30 kilometres per litre (3.3 L/100 km),
or twice an average small car, and carbon dioxide emissions of 100 g/km.
On 3 January 2012, Bajaj auto unveiled the Bajaj RE60, a mini car for intra-city urban
transportation. The target customer group will be Bajaj's three-wheeler customers.
According to its Managing Director Rajiv Bajaj, the RE60 powered by a new 200 cc
rear mounted petrol engine will have a top speed of 70 kilometres per hour (43 mph),
a mileage of 35 kilometres per litre and carbon dioxide emissions of 60 g/km.

Tempo Firodia: Bajaj Auto bought a controlling stake in the Tempo Firodia company,
renaming it "Bajaj Tempo". Germany's Daimler-Benz, a long-time collaborator with
Firodia because of their ownership of the original Tempo works in Germany, owned
16% of Bajaj Tempo. Daimler sold their stake back to the Firodia group in 2001,
meaning that they once again held a controlling interest, with BAL retaining 24% of
the shares. It was agreed that Bajaj Tempo would gradually phase out the use of the
"Tempo" brand name, as it still belonged to Mercedes-Benz. The name of the
company was changed to Force Motors in May 2005, dropping "Bajaj" as well as
"Tempo", over the objections of Bajaj Auto with whom the company shares a long
history as well as a compound wall.
KTM Power Sports AG: In November 2007, Bajaj Auto acquired 14.5% stake
in KTM Power Sports AG (holding company of KTM Sportmotorcycles AG). The two
companies have signed a cooperation deal, by which KTM will provide the know-how
for joint development of the water-cooled four-stroke 125 and 250 cc engines, and
Bajaj will take over the distribution of KTM products in India and some other
Southeast Asian nations. As on 31 March 2013, Bajaj Auto held 47.96% stake in the

Awards and Recognitions

Bajaj Pulsar 135 LS received Bike of the Year 2010 award from BBC TopGear and Bike India.

Pulsar 220 DTS-Fi received the Bike of the Year 2008 award by all major
Indian automobile magazines like Overdrive, AutoCar, Business Standard
Motoring and Bike Top Gear.

In 2006, Bajaj Auto won the Frost & Sullivan Super Platinum Award for
manufacturing excellence in its Chakan Plant.

It received award for The Most Customer Responsive Company in

Automobiles category in a survey conducted by Economic Times for the years
2004, 2006 and 2008.

Bajaj Auto received the Bike Maker of the Year award in ICICI Bank
Overdrive Awards 2004.

Bajaj Pulsar 180 DTS-i won the BBC World Wheels Viewers Choice Two
Wheeler of the Year 2003 award.


Hero Motocorp Ltd., formerly known as Hero Honda, is an Indian motorcycle

and scooter manufacturer based in New Delhi, India.
The company is the largest two wheeler manufacturer in India. In India, it has a
market share of about 46% share in 2-wheeler category. The 2006 Forbes 200 Most
Respected companies list has Hero Honda Motors ranked at #108. On 31 March 2013,
the market capitalisation of the company was INR 308 billion (USD 5.66 billion).
Hero Honda started in 1984 as a joint venture between Hero Cycles (sometimes called
Hero Group, not to be confused with the Hero Group food company of Swizerland) of
India and Honda of Japan. In 2010, when Honda decided to move out of the joint
venture, Hero Group bought the shares held by Honda. Subsequently, in August 2011
the company was renamed Hero MotoCorp with a new corporate identity.

In June 2012, Hero MotoCorp approved a proposal to merge the investment arm of its
parent Hero Investment Pvt. Ltd. into the automaker. The decision comes after 18
months of its split from Honda Hero.

Formation of Hero MotoCorp

The name of the company was changed from Hero Honda Motors Limited to Hero
MotoCorp Limited on 29 July 2011. The new brand identity and logo of Hero
MotoCorp were developed by the British firm Wolff Olins. The logo was revealed on
9 August 2011 in London, to coincide with the third test match between England and
Hero MotoCorp can now export to Latin America, Africa and West Asia. Hero is free
to use any vendor for its components instead of just Honda-approved vendors.
On 21 April 2014, Hero MotoCorp announced their plan on a $40 Mn joint venture
with Bangladesh's Notiol Niloy Group in the next five years. also hero updated its
100cc engine range in 2014 for 100cc bikes except hero dawn.


Sleek (Discontinued)

Street (Discontinued)


Ambition 133, Ambition 135 (Discontinued)

CBZ, CBZ Star (Discontinued)

CBZ Xtreme, Hero Xtreme 2014, Xtreme Sports

CD 100, CD 100 SS, Hero Honda Joy, CD Dawn, CD Deluxe, CD Deluxe (Self

New HF Dawn,New HF Deluxe, HF DELUXE ECO

Glamour, Glamour F.I.


Karizma, Karizma R, Karizma ZMR FI

Passion, Passion Plus, Passion Pro, Passion XPro, New Passion Pro TR

Splendor, Splendor+, Splendor+ (Limited Edition), Super Splendor, Splendor

NXG, Splendor PRO, Splendor [iSmart],Splendor Pro Classic

Hero Impulse launched in 2011 after the separation of Hero and Honda. Its
India's first off-road and on road Bike.

Hero Ignitor launched in 2012

Hero HX250r

It has 4 models in scooters:



Maestro Edge


Company Performance
The company has sold over 47 million 2-wheelers since its inception in 1984 till
March 2013. It sold 6.07 million 2-wheelers in 2012, out of which 5.5 million were
motorcycles. Hero Motocorp sells more two wheelers than the second, third and fourth
placed two-wheeler companies put together. Its most popular bike Hero Honda
Splendor sells more than one million units per year
In 2013, Hero MotoCorp registered best ever calendar year performance of more than
6.1 million unit sales. By selling 6.25 lakh units in the month of October, it became
the first-ever manufacturer to cross landmark 6 lakh unit sales in a month. In the last
quarter of the year or say in the festive season, the company sold more than 1.6
million units, while in non festive time in AprilMay 2013, it managed to sell out
quite good numbers of units- 1.1 million.

Awards and Recognition

The Brand Trust Report published by Trust Research Advisory has ranked Hero
Honda in the 7th position among the most trusted brands in India.

It received the 'Best value for Money Bike Maker' and 'Best Advertising' in
Two Wheelers Category at the Auto India Best Brand Awards 2012.

Chapter 3
Financial Statement
Bajaj Auto Ltd

Balance Sheet As on 31March 2015

Statement of Profit and Loss for the year ended 31st March 2015

Cash Flow Statement for the year ended 31st March 2015

Chapter 4
Financial Statement
Hero Motocorp Ltd

Balance Sheet As on 31March 2015

Statement of Profit and Loss for the year ended 31st March 2015

Cash Flow Statement for the year ended 31st March 2015


Financial Statements

Comparison of Financial Statements on the basis of Ratio Analysis



It was found that profit of Bajaj Auto Ltd for year 2014-15 was higher than
Hero Motocorp Ltd.

The sale of motorcycles of Hero Motocorp Ltd was higher.

It was found that the equity fund of Bajaj Auto Ltd is twice than Hero
Motocorp Ltd.
The earnings per share of Hero Motocorp Ltd is higher because their
equity fund is lower than Bajaj Auto Ltd.
The inventory at the year end of both companies is almost same.
It was noticed that Bajaj Auto Ltd launched their 5 new products in
previous year.

To increase the sale of motorcycles, demand of the market must be studied
New products should be launched.
Company should focus on Innovation, Research and Development.
To attract the young generation, new sports bike must be launched like the
Bajaj Auto Ltd did it in last by launching KTM Duke series.
Company should increase their service station chains. Whenever customer goes
with the problem and after solving their problems customers feels satisfied.
Problems must be solving immediately so that customer may not feel
After sale of their products the companies should take feedback, whether their
vehicle is performing well or not. It will help in maintaining good customer
Companies should shows actual features of the products in advertisements.
Cost of motorcycles should not be high.

Analysis and interpretation of financial statements is an important tool in assessing
companys performance. It reveals the strengths and weaknesses of a firm. It helps the
clients to decide in which firm the risk is less or in which one they should invest so
that maximum benefit can be earned. It is known that investing in any company
involves a lot of risk. So before putting up money in any company one must have
thorough knowledge about its past records and performances. Based on the data
available the trend of the company can be predicted in near future.
This project mainly focuses on the basics of different types of financial statements.
Balance Sheet and Profit & Loss statements of five different coal and non coal mining
companies have been studied.
From ratio analysis of Balance Sheet and P & L Statement of Bajaj Auto Ltd of 201415 it was concluded that liquidity position of the company is good. Current ratio, debtequity ratio, quick ratio, net profit margin, operating profit margin, gross profit
margin, return on assets, return on investments and return on capital employed were
found to be satisfactory.
Short term liquidity position of Hero Motocorp Ltd in 2014-15 was not good as
compared to Bajaj Auto Ltd. However, current ratio, quick ratio, net
profit margin, return on assets, return on investments and return on capital employed
were unsatisfactory. The ratios that are found to be desirable are debt-equity ratio,
operating profit margin and gross profit margin.


Annual Report 2015
a) Bajaj Auto Ltd
b) Hero Motocorp Ltd